ITV Share Price Dropped 7.51% As Its Digital Revenues Soared

The ITV plc (LON: ITV) share price dropped 7.51% after releasing its earnings results for the nine months to 30 September 2023. The company noted that its performance during the review period aligned with expectations as its revenues rose by 1%.

The company’s total revenue registered a 1% increase, reaching £2,975 million, compared to last year’s £2,948 million. The growth was primarily attributed to robust performances in ITV Studios and M&E digital revenues, effectively offsetting the decline in linear advertising revenue and demonstrating ITV's strategic diversification efforts.

ITV Studios achieved a remarkable 9% increase in revenue, totalling £1,516 million, compared to £1,387 million in 2022. ITV Studios continued its diversification efforts by producing an array of new and returning programs and formats, both in the UK and internationally.

The Media & Entertainment (M&E) revenue experienced an anticipated 7% decrease, amounting to £1,459 million, compared to £1,561 million in the previous year. The decline was mainly attributed to a 7% drop in total advertising revenue (TAR).

However, digital advertising revenue, a component of digital revenue, remained robust, marking a 25% increase at £283 million by the end of September, up from £227 million in 2022. 

ITVX, a digital platform, continued to perform strongly, with total digital revenues up by 23% and total streaming hours increasing by 27% through September. Monthly active users continued to grow as expected.

The company anticipates ITV Studios to achieve total organic revenue growth of at least 5% annually on average until 2026, surpassing market growth rates. ITV remains confident in achieving at least £750 million in digital revenues by 2026, primarily driven by the successful performance of ITVX.

Carolyn McCall, ITV’s Chief Executive, said: “ITV continues to make good strategic progress despite the challenging macro environment which is impacting the advertising market and also the demand for content from free-to-air broadcasters in the UK and internationally. Studios and M&E digital revenues grew strongly in the nine months to the end of September, more than offsetting the expected decline in linear advertising, delivering total group revenue growth of 1%. ITV Studios grew faster than the market, with 9% revenue growth, driven by its position as a scaled and diversified global production business.”

ITV share price. 

The ITV share price dropped 7.51% to trade at 60.63p from Tuesday’s closing price of 65.55p.